Interpretation of September 2024 CPI and PPI Data by Dong Lijuan, Chief Statistician of the Urban Division of the National Bureau of Statistics

The National Bureau of Statistics today released the CPI (Consumer Price Index) and PPI (Producer Price Index) data for September 2024. In response, Dong Lijuan, the Chief Statistician of the Urban Division of the National Bureau of Statistics, provided an interpretation of the data.

1. CPI Month-on-Month Remains Flat, Year-on-Year Increase Slows

In September, the consumer market operated smoothly, with prices remaining generally stable. The national CPI remained unchanged month-on-month, rising 0.4% year-on-year.

Month-on-month, CPI remained flat, compared to a 0.4% increase in the previous month. Among food prices, there was a 0.8% rise, down by 2.6 percentage points from the previous month, contributing about 0.16 percentage points to the CPI month-on-month increase. Within food, prices of fresh vegetables, eggs, fresh fruits, and pork rose by 4.3%, 2.5%, 2.1%, and 0.4%, respectively, mainly influenced by the back-to-school season and the Mid-Autumn Festival, contributing about 0.17 percentage points to the CPI month-on-month increase. Prices of aquatic products dropped by 0.5%, as the fishing season ended and supply increased. Non-food prices decreased by 0.2%, narrowing by 0.1 percentage points compared to the previous month, contributing about 0.18 percentage points to the CPI month-on-month decrease. In non-food categories, with the end of the summer holiday, prices of airline tickets, hotel accommodations, and tourism services dropped by 14.8%, 7.4%, and 6.3%, respectively. Domestic gasoline prices decreased by 2.9%, influenced by fluctuations in international oil prices. Educational services increased by 0.9% due to the start of the new school term, while clothing prices rose by 0.8% due to the seasonal change in autumn apparel.

Year-on-year, the CPI rose by 0.4%, a slowdown of 0.2 percentage points compared to the previous month, mainly due to the high base from the same period last year. Among food prices, there was a 3.3% rise, which expanded by 0.5 percentage points compared to last month, contributing about 0.61 percentage points to the CPI year-on-year increase. Prices of fresh vegetables, pork, and fresh fruits rose by 22.9%, 16.2%, and 6.7%, respectively. The decline in prices of beef, lamb, eggs, chicken, and dairy ranged from 1.9% to 13.1%. Non-food prices shifted from a 0.2% increase last month to a 0.2% decrease, contributing about 0.19 percentage points to the CPI year-on-year decrease. In non-food categories, energy prices dropped by 3.5%, expanding the decrease by 2.5 percentage points compared to last month. The prices of industrial consumer goods excluding energy decreased by 0.2%, the same as last month. Among them, the prices of new energy vehicles and fuel vehicles decreased by 6.9% and 6.1%, respectively, with the decrease narrowing. Prices of traditional Chinese medicinal materials, household textiles, and gold jewelry rose by 3.9% to 22.5%. Service prices increased by 0.2%, a slowdown of 0.3 percentage points, with tourism prices turning from a 0.9% increase last month to a 2.1% decrease. Airplane tickets and hotel accommodation prices dropped by 14.1% and 5.6%, respectively, with the decrease expanding.

According to calculations, the 0.4% year-on-year CPI change in September had an impact from last year's high base of about -0.5 percentage points, compared to -0.3 percentage points last month. The new impact of price changes this year was about 0.9 percentage points, the same as last month.

2. PPI Month-on-Month Decline Narrowed, Year-on-Year Decline Expanded

In September, affected by fluctuations in international commodity prices and insufficient domestic market demand, the PPI month-on-month decline narrowed, while the year-on-year decline expanded.

Month-on-month, PPI dropped by 0.6%, a narrowing of 0.1 percentage points compared to the previous month. Among production materials, prices decreased by 0.8%, narrowing by 0.2 percentage points from last month. Prices of living materials shifted from flat to a 0.1% decrease. The drop in domestic petroleum and natural gas extraction prices was 3.2%, influenced by a decrease in international oil prices. Prices of non-ferrous metals first decreased and then increased internationally, leading to a 0.4% decrease in domestic prices of non-ferrous metal smelting and rolling industries, narrowing by 1.9 percentage points compared to last month. The real estate market remained in an adjustment period, and some regions were affected by strong wind and rain, leading to weaker demand for building materials, with non-metallic mineral product prices falling by 0.8%. Due to policy expectations, steel demand showed signs of recovery in the second half of the month, but prices of ferrous metal smelting and rolling industries still decreased by 3.3%, narrowing by 1.1 percentage points. Coal production remained stable, with sufficient winter storage coal, leading to a 1.3% drop in coal mining and washing industry prices. In the equipment manufacturing sector, prices of lithium-ion battery manufacturing decreased by 0.3%, and new energy vehicle manufacturing prices fell by 0.1%. In the consumer goods manufacturing sector, prices of agricultural and sideline food processing decreased by 0.3%, and food manufacturing prices decreased by 0.2%. Prices in cultural, educational, industrial, and sports goods manufacturing rose by 0.4%, and textile, clothing, and accessory manufacturing prices increased by 0.2%.

Year-on-year, PPI decreased by 2.8%, with the decline expanding by 1.0 percentage points compared to last month, driven by the high base from the same period last year. Among production materials, prices decreased by 3.3%, expanding by 1.3 percentage points compared to last month, while prices of living materials dropped by 1.3%, with the decline widening by 0.2 percentage points. Among the 40 major industrial categories surveyed, prices in the black metal smelting and rolling industry fell by 11.1%, petroleum and natural gas extraction by 10.1%, petroleum, coal, and other fuel processing industries by 9.4%, non-metallic mineral product industries by 5.1%, agricultural and sideline food processing industries by 4.9%, chemical raw materials and products manufacturing by 4.1%, electrical machinery and equipment manufacturing by 3.1%, and coal mining and washing industries by 2.6%. These eight industries contributed approximately 2.04 percentage points to the year-on-year PPI decline, accounting for more than 70% of the total drop, with the downward impact expanding by 0.74 percentage points compared to last month. Prices in non-ferrous metal smelting and rolling industries rose by 5.9%, while prices in the cultural, educational, industrial, and sports goods manufacturing industry increased by 4.6%, and prices in railway, shipbuilding, aerospace, and other transportation equipment manufacturing grew by 0.5%.

According to calculations, the -2.8% year-on-year PPI change in September had an impact from last year's high base of about -0.5 percentage points, compared to -0.1 percentage points last month. The new impact of price changes this year was about -2.3 percentage points, compared to -1.7 percentage points last month.

Source: National Bureau of Statistics, October 16, 2024